Blockchain technology, particularly EVM-compatible blockchains, has radically transformed how we think about trust, value transfer, and decentralized applications (dApps). Ethereum, the frontrunner in this space, has been the playground for developers and innovators to build decentralized finance (DeFi), digital art (NFTs), and beyond. However, despite its revolutionary potential, Ethereum faces a fundamental challenge: transaction inefficiency.

Ethereum processes roughly 15-30 transactions per second (TPS). In contrast, payment networks like Visa handle over 1,700 TPS on average. This gap is not because Ethereum lacks innovation but because the very architecture that enables decentralization also imposes bottlenecks. As the world looks to blockchain for global-scale solutions, Ethereum’s single-threaded execution model, coupled consensus and execution, and storage inefficiencies mean that it struggles to meet the needs of millions of users. This inefficiency creates high fees, slow finality, and a system that often feels impractical for mainstream adoption.

So how do we build a blockchain that scales to millions while still retaining the core ethos of decentralization and trustlessness?

Enter Monad—a Layer 1 blockchain designed not to replace Ethereum but to optimize the very way EVM-compatible blockchains process transactions. Monad offers a paradigm shift, introducing radical but well-reasoned changes that solve the very inefficiencies that have stifled blockchain scalability.

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The Solution: A new approach to transaction processing

Monad isn’t trying to reinvent the wheel. It embraces the Ethereum Virtual Machine (EVM) and maintains compatibility with Ethereum’s rich ecosystem. But it takes a surgical approach to fixing Ethereum’s inefficiencies by optimizing the processes that slow it down.

At its core, Monad offers a solution by decoupling execution from consensus. Unlike Ethereum, where every validator must execute transactions in real-time to reach consensus, Monad rethinks the process. In Monad’s world, the network first agrees on the order of transactions and then proceeds to execute them independently. This seemingly simple separation is the key to unlocking a blockchain that can scale to 10,000 TPS with 1-second finality.

Monad prioritizes two things above all: decentralization and efficiency. Instead of sacrificing one for the other, Monad’s approach ensures that transaction throughput increases without compromising the trustless, decentralized nature of the network.

Now, let’s delve into the optimizations that make this vision a reality.

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The key optimizations: How Monad breaks the bottlenecks

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1. MonadBFT

Ethereum’s Proof-of-Stake (PoS) mechanism intertwines transaction validation and execution. But Monad takes inspiration from HotStuff to create MonadBFT, a consensus protocol that eliminates the need for execution during consensus.

By doing so, MonadBFT focuses solely on reaching agreement on transaction ordering. It achieves 1-second block times with single-slot finality, compared to Ethereum’s multi-minute finality, by reducing communication rounds and allowing consensus to happen faster. This streamlined approach lets validators come to agreement on a block’s content, even before they execute it.

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2. Deferred Execution

In Ethereum, consensus and execution are linked in a way that forces validators to both agree on and execute transactions within the same block window, which can be inefficient. Deferred Execution in Monad separates the two, enabling the network to reach consensus first, and allowing transaction execution to take place afterward, in parallel.

What does this mean in practice? Instead of validators being forced to immediately execute transactions as they propose blocks, they can delay execution. The transactions are committed in the agreed order, but the execution happens alongside consensus for the next block. This approach vastly improves throughput by allowing the network to optimize execution time across multiple blocks.

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3. Parallel execution and Superscalar pipelining

Monad implements optimistic parallel execution, where transactions are processed in parallel across multiple cores but committed in their original order, maintaining the same deterministic outcomes as Ethereum. While this boosts throughput, it can lead to state conflicts when transactions depend on each other. In such cases, Monad re-executes conflicting transactions to ensure correctness.

To further enhance efficiency, Monad introduces superscalar pipelining. This technique divides the transaction processing into multiple stages (e.g., signature verification, state access) and processes these stages in parallel, similar to how modern CPUs work. By overlapping different stages of transaction execution, Monad maximizes resource utilization, reducing delays and increasing throughput, all while preserving the linear ordering of transactions.

A simple diagram to illustrate superscalar pipelining:

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4. MonadDb

State storage is a lesser-known bottleneck in Ethereum. The Merkle Patricia Trie (MPT) structure that Ethereum uses is embedded into key-value databases like LevelDB, which weren’t designed for blockchain workloads. Monad solves this inefficiency by designing MonadDb, a storage solution that natively implements the Patricia Trie in both on-disk and in-memory formats.

Additionally, MonadDb uses asynchronous I/O to avoid the blocking nature of traditional storage operations. This means that even if one transaction is waiting for state to be loaded from disk, the system can continue processing other transactions, thereby optimizing overall performance.

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Challenges of these optimizations

While Monad’s optimizations are powerful, they are not without challenges.

• Parallel execution conflicts: While optimistic parallel execution boosts throughput, it can lead to state conflict when two transactions attempt to modify the same variable. Although Monad re-executes conflicting transactions, there’s a cost in terms of processing power and efficiency. Predicting dependencies and scheduling transactions intelligently is a technical challenge that Monad is continuously refining.
• Deferred execution lag: Decoupling consensus and execution introduces a slight lag between consensus and execution, which could be problematic in use cases that require real-time results, such as high-frequency trading. Monad mitigates this with its delayed Merkle root system, but there is still a gap between knowing the order of transactions and knowing their outcome.

Despite these challenges, the benefits far outweigh the potential drawbacks. Let’s look at the results Monad’s innovations deliver.

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The Results: A blockchain built for scale

Thanks to these four key optimizations, Monad aims to achieve what few blockchains can:

• 10,000 Transactions Per Second (TPS): By decoupling consensus from execution and enabling parallel execution, Monad can handle thousands of transactions per second, a dramatic improvement over Ethereum’s 15-30 TPS.
• 1-Second Finality: Single-slot finality means that transactions are finalized in just 1 second. There are no long waits for confirmation, making Monad ideal for time-sensitive applications.
• Lower Transaction Costs: By increasing throughput and optimizing resource usage, Monad significantly reduces the per-transaction cost, making it affordable for users and scalable for dApps with millions of users.

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The current state of Monad and what’s next

Monad is still in development, but its ambitious roadmap is clear. The project’s public testnet is expected in the near future, allowing developers to integrate it into their Ethereum-compatible wallets and applications. This will be a crucial step in proving Monad’s ability to scale without sacrificing the core values of decentralization and trustlessness.

Monad’s team is focused on ensuring that its network remains easy to use for developers familiar with Ethereum. They’ve built Monad as a drop-in replacement for Ethereum, meaning developers can port their dApps with little to no changes. As more users and developers flock to the testnet, Monad aims to further refine its consensus, execution, and storage systems, solving the scalability trilemma in a way that balances decentralization, performance, and security.

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Final word

Monad offers a bold new approach to solving blockchain’s biggest bottleneck: transaction inefficiency. By decoupling execution from consensus, enabling parallel execution, and optimizing storage with MonadDb, it delivers a blockchain that can handle 10,000 TPS with 1-second finality—all without sacrificing decentralization. As Monad continues to build and refine its technology, it stands as a potential blueprint for the future of blockchain scalability, offering a glimpse of what’s possible when we think beyond the limitations of today’s networks.

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Frequently asked Questions (source: docs.monad.xyz):

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1. In what language is the Monad client developed?

The Monad client is built with a modular software architecture, separating the tasks of consensus and execution between two software modules: the consensus client and execution client respectively. The consensus client is written in Rust which is a memory-safe language that allows for low-level optimizations. The execution client is written in C/C++, well-established and battle-tested languages for developing low-level system critical code.

2. Why is Monad built as an L1 network?

The Monad network is a full stack solution for developers, allowing access to a highly composable ecosystem without compromising on real-time censorship resistance. While L2 solutions may offer one way to compress data stored on the base layer, the Monad blockchain is a scalable base layer for the EVM itself at its most fundamental layer. A highly-performant base layer gives application developers the best of both worlds, with a high degree of composability and real-time censorship resistance in the name of scalability.

3. Is Monad truly 100% EVM-compatible without code changes?

Yes! The Monad blockchain is 100% EVM compatible at the bytecode level - meaning contracts from ETH mainnet, or other fully EVM compatible networks will work out-of-the-box without requiring any code changes.

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

Key Takeaways

• Chorus One processes 11.4% more transactions per second than the average Solana validator, enhancing network throughput.
• With a skip rate of 2.03%, Chorus One outperforms both the network average (5.19%) and the superminority (5.68%).
• Chorus One's blocks contain 7.8% more transactions on average compared to other validators
• Chorus One achieves top performance through advanced hardware, zero-downtime deployments, strategic data center locations, and continuous monitoring.
• If all validators performed like Chorus One, Solana’s overall transaction capacity could increase by 11.4%.

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There are many aspects to validator performance on Solana, and different metrics are important to different people. For users of the Solana network, throughput (transactions per second) and latency (how quickly a transaction lands) are key metrics. In this article we’ll dive into two factors that affect those: skip rate and block size. We’ll explain how Chorus One is able to outperform both network average and the superminority on these metrics. If all validators performed as well as Chorus One on these metrics, Solana would be able to process 11.4% more transactions per second.

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Throughput

As a Solana user, when you submit a transaction, you want it to be included in the chain as quickly as possible, as cheaply as possible. When the chain can process only a limited amount of transactions per second, that means that only users who are willing to pay high priority fees can get their transaction included. When the chain can process more transactions per second, transaction processing capacity becomes less scarce, and transaction fees go down. Solana’s throughput is determined by the validators that make up the network, so for good network performance, it is important to delegate to a validator that performs well.

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Time period and comparison

For this article we look at the month of July 2024. All metrics are reported over the period from midnight July 1st until midnight August 1st in the UTC time zone. (Slot 274965076 until 280826904, for those who want to reproduce our findings.)

In this article we contrast Chorus One against two groups of validators: the entire network (including Chorus One), and the superminority. The superminority is the smallest set of validators that together control more than one third of the stake. We use the superminority from epoch 650, the final epoch in July. It consists of the top 19 validators by stake.

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Skip rate

In the Solana network, validators periodically have a duty to produce blocks. Before the start of the epoch, the protocol sets the leader schedule, which determines when every validator has to produce a block. Validators with more stake get assigned more blocks to produce.

If all goes well, when a validator’s turn comes to be the leader, the validator produces a block. The chain grows by one block, and users’ transactions get included. When things don’t go well, the leader fails to produce a block, or the block may not be accepted by the other validators. When the leader fails to extend the chain, this is called a skip, and the fraction of blocks skipped out of blocks assigned in some period of time is called the skip rate. Skips are bad for users of the network, because during a skip, no transactions get processed. Skips lower the throughput of the chain, and delay when transactions get processed. A lower skip rate is therefore better.

A validator can skip for multiple reasons. Of course a validator that is offline will be unable to produce a block, but even when it is online and produces a block, that can still result in a skip. For example, the validator could have been slightly late, and the network has already moved on, assuming the validator skipped its duty. Many of the factors that affect skip rate are directly or indirectly under the validator’s control, but some amount of skipping is inevitable in a decentralized network. During times of high activity, skip rate is generally higher network-wide than during quiet periods. Therefore, the skip rate is not meaningful in isolation, but comparing skip rate between validators is one way to judge their performance.

Over July 2024, Chorus One achieved a skip rate of 2.03%, while the network-wide skip rate was 5.19%. This means that average Solana validators fail to produce their blocks more than 2.5 times as often as Chorus One.

Maybe network average is not a fair comparison though? It may be the case that a few bad validators are pulling up the average. So let’s look at the superminority, the top validators by stake. This relatively small set of validators has the responsibility to produce one third of the blocks, so its influence on the chain’s throughput is large. Over July 2024, the superminority together achieved a skip rate of 5.68%, which is even worse than network average. Superminority validators fail to produce their blocks almost 3× as often as Chorus One.

The Solana network is effectively leaving 3.3% of its blocks on the table by keeping stake delegated to validators with high skip rates.

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Block size

Aside from skip rate, a major factor for throughput is the number of transactions that every block contains. When blocks can fit more transactions, the throughput of the chain goes up. When validators are able to build larger blocks, fewer user transactions have to be postponed to the next block, so latency goes down. Furthermore, more capacity means lower transaction costs.

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Over July 2024, blocks produced by Chorus One contained on average 1696.2 transactions. (This includes vote transactions that contribute to Solana’s consensus mechanism.) The network-wide average over this period was a mere 1573.3 per block. This means that Chorus One includes 7.8% more transactions per block than average validators.

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Again, let’s compare this to the validators with the greatest responsibility and disproportionate impact on chain-wide throughput: the superminority. Here we see that with 1640.6 transactions per block, the superminority does outperform the network average, but nonetheless Chorus One outperforms the superminority by 3.4%.

This means that the Solana network is effectively leaving a 7.8% throughput boost on the table, by keeping stake delegated to low-performing validators. This number is only for produced blocks, we don’t count skips as zero transactions per block. This means that the 7.8% boost would come on top of the 3.3% skip rate boost. Combined, this means that Chorus One achieves 11.4% more transactions per second than average validators.

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How Chorus One achieves top performance

Why is Chorus One able to process 11.4% more transactions per second than other validators? As is often the case with performance optimization, there is no single trick, but if you stack enough small optimizations, the combined result can be substantial. A few of the techniques we use:

• We use the best hardware available on the market. Solana is very sensitive to single-core CPU performance, and with the current rate of innovation in the hardware world, a CPU that was top of the line 18 months ago no longer cuts it to be a top-tier validator today. Chorus One is always using the latest generation CPUs to ensure maximum performance.
• We deploy with zero downtime. Occasionally we need to restart a validator client (for example to update after a new version is released) or an entire machine (for example, to apply security updates). This process can take many minutes, during which the validator cannot vote or produce blocks. This amount of downtime is unacceptable to us, so we run multiple Solana instances, on different machines. When we need to restart one instance, a different instance takes over validator duties, ensuring that we don’t skip a single block. This redundancy also enables us to maintain uptime in the case of hardware or network failures, which is something that node operators who save costs by running only a single node are unable to do.
• We use the best locations. We work with multiple hardware providers and data centers, who offer ample bandwidth, to find the location where Solana performs best. While doing so, we have to keep decentralization of the network in mind. Being close to peers is good for performance, but we don’t want to run from a data center where too many other validators are already located; the network has to remain resilient against disasters in that location. Our secondary instance (for failover) is always located in a different country than our primary one. Operating multiple nodes in multiple locations enables us to measure which locations perform best, and enables us to respond quickly to changes in network conditions.
• We continuously monitor our nodes, and our 24/7 oncall rotation can respond in minutes when something is amiss. As a professional node operator, we have a team of platforms engineers who are working tirelessly to keep our nodes running smoothly.

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Final Word

In this article we highlighted two key Solana performance metrics that matter for users of the network: skip rate and block size. Lower skip rates and larger block sizes mean that users can get their transactions included faster and for a lower fee. These two metrics contribute to how many transactions per second Solana can process. Through multiple optimizations and operational practices, Chorus One achieves 11.4% more transactions per second than the network average. If all delegators would delegate to validators who perform as well as Chorus One, Solana would be able to process 11.4% more transactions per second.

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About Chorus One

Chorus One is a leading institutional staking provider, securing over $3 billion in assets across 60+ Proof-of-Stake networks. Since 2018, Chorus One has been a trusted partner for institutions, offering enterprise-grade solutions, industry-leading research, and investments in cutting-edge protocols.

The upcoming launch of Babylon’s Bitcoin Staking Mainnet marks a significant milestone in the cryptocurrency landscape and in the evolution of Bitcoin. Babylon is redefining the utility of Bitcoin by integrating it with Proof-of-Stake (PoS) systems, offering new opportunities for Bitcoin holders. Here’s what you need to know about this launch:

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1. What is Babylon Bitcoin Staking?

Babylon’s Bitcoin Staking allows Bitcoin holders to participate in the security of PoS blockchains without transferring their assets to a third party. Traditionally, Bitcoin has been seen as a store of value, but Babylon expands its utility by enabling Bitcoin to play an active role in securing various PoS ecosystems. This is achieved through a trust-minimized protocol that connects Bitcoin holders with the demand for network security across multiple blockchain systems, including PoS chains. Read our comprehensive overview of Babylon here.

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2. What is Babylon’s Mainnet Launch?

The mainnet launch of Babylon represents the transition from a developmental stage to a fully operational network. This is when the protocol becomes available for public use, allowing Bitcoin holders to start staking their assets on a live blockchain. The launch is designed to be phased, ensuring that each component of the network is thoroughly tested and integrated before moving to the next stage. This approach provides a structured rollout, allowing users to gradually engage with the staking process.

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3. What Are the Three Phases of the Launch?

Babylon’s mainnet launch is divided into three distinct phases, each with specific goals and functionalities:

• Phase 1: Bitcoin Locking
  • This phase initiates the staking process. Bitcoin holders can begin locking their Bitcoin by submitting Bitcoin staking transactions directly to the Bitcoin blockchain. These transactions secure the Bitcoin within a self-custodial staking script, where it is prepared to participate in PoS consensus validation. Stakers also designate a finality provider by specifying the provider's public key, allowing their Bitcoin to be used in the PoS process without actually transferring the Bitcoin to the provider.
• Phase 2: Bitcoin Staking Activation
  • In this phase, Babylon will launch its PoS chain, which will begin receiving security from the Bitcoin locked in Phase 1. Finality providers who have received adequate delegations from Bitcoin stakers will participate in the consensus of the Babylon PoS chain, helping to determine the finality of its blocks. This phase also introduces the Bitcoin timestamping protocol, which ensures cross-chain time synchronization, a crucial aspect of maintaining security across multiple blockchains.
• Phase 3: Bitcoin Multi-Staking Activation
  • The final phase transforms Babylon into a marketplace for shared security. This allows Bitcoin holders to stake their assets across multiple PoS systems, earning rewards from various sources. The Babylon PoS chain will act as a control plane, facilitating the staking process across different blockchains and ensuring that Bitcoin’s security is effectively leveraged across the ecosystem.

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4. What Can You Do in the Babylon Mainnet Launch?

During the Babylon mainnet launch, Bitcoin holders can actively participate in securing PoS blockchains by locking and staking their Bitcoin. In Phase 1, you can initiate staking by locking your Bitcoin in a secure, self-custodial vault on the Bitcoin blockchain. As the launch progresses into Phase 2, your locked Bitcoin will begin to contribute to the consensus process of the Babylon PoS chain. By Phase 3, you’ll have the ability to stake your Bitcoin across multiple PoS chains, maximizing your potential rewards and playing a crucial role in the security of these networks.

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5. How Can You Stake Your Bitcoin?

Staking your Bitcoin with Babylon is a multi-step process that begins in Phase 1:

• Bitcoin Locking: Start by submitting a Bitcoin staking transaction to the Bitcoin blockchain. This locks your Bitcoin in a self-custodial script, ensuring that your assets remain secure and under your control.
• Choosing a Finality Provider: When locking your Bitcoin, you will specify the public key of a finality provider like Chorus One, which is the entity that will use your Bitcoin’s staking power in the PoS system. If you hold the private key corresponding to this public key, you can self-delegate, retaining full control over your Bitcoin.
• Staking Activation: In Phase 2, your locked Bitcoin will be activated to participate in PoS consensus, contributing to the security of the Babylon PoS chain.

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6. What Rewards Can You Get?

In Phase 1, there are no direct staking rewards because the PoS chain is not yet active. Instead, Babylon introduces a point system to track staking activity. These points, though they do not have direct monetary value, could potentially be used for future benefits within the Babylon ecosystem. As the network progresses into Phase 2 and beyond, your Bitcoin will earn rewards based on its contribution to the security of the PoS systems, allowing you to gain value from your staked assets.

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7. Which Wallets Can You Use?

To stake your Bitcoin with Babylon, you’ll need a compatible Bitcoin wallet. The official Babylon staking web application (btcstaking.babylonlabs.io) provides a list of verified finality providers and supports most Bitcoin wallets. You can also use third-party services such as staking websites, custody solutions, or command-line interface (CLI) tools if you are more technically inclined. It’s important to choose a wallet that meets your security needs and is compatible with the staking process. Here’s a list of supported wallets:

1. OKX Wallet
   • Type: Software Wallet
   • Platforms: Web, Extension, Mobile
2. Bitget Wallet
   • Type: Software Wallet
   • Platforms: Web, Extension, Mobile
3. OneKey Wallet
   • Type: Hardware and Software Wallet
   • Platforms: Desktop, Mobile, Hardware Bridge, Extension, Web
4. Binance Web3 Wallet
   • Type: Software Wallet
   • Platform: Binance App
5. Tomo Wallet
   • Type: Software Wallet
   • Platforms: Extension, Mobile
6. Keystone Wallet
   • Type: Hardware Wallet
7. imToken Wallet
   • Type: Software and Hardware Wallet
   • Platform: Mobile

8. What Are the Transaction Details in Phase 1?

During Phase 1, all transactions are conducted on the Bitcoin blockchain. These include:

• Staking Transactions: Used to lock Bitcoin and initiate the staking process.
• Unbonding and Early Withdrawal Transactions: If you wish to withdraw your Bitcoin before the staking period expires, you’ll need to submit an unbonding transaction, followed by a withdrawal transaction after a waiting period of approximately seven days.
• Automatic Expiration and Withdrawal: If you do not withdraw your Bitcoin early, it will automatically become available for withdrawal after 64,000 Bitcoin blocks (around 15 months).

Notably, there is no PoS slashing in Phase 1, meaning your staked Bitcoin is not at risk of being slashed for any consensus violations.

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9. What Are the Limits and Caps in Phase 1?

To ensure security and broad participation, Phase 1 introduces several limits:

• Total Staking Cap: Initially set at 1,000 Bitcoins, this cap controls the total amount of Bitcoin that can be staked during this phase. Stakes are accepted on a first-come, first-served basis.
• Minimum and Maximum Stakes: The minimum stake is set at 0.005 Bitcoins, ensuring that the staking amount can cover transaction fees. The maximum stake is capped at 0.05 Bitcoins, encouraging widespread participation and preventing any single entity from dominating the staking pool.

These caps and limits are designed to foster a secure and inclusive staking environment.

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10. Eligibility and Security Considerations

Before participating in the Babylon mainnet launch, it’s crucial to ensure you meet the eligibility criteria. Staking is prohibited for residents of certain countries, including the United States, Canada, Australia, and Mainland China, due to regulatory restrictions. Additionally, Babylon has implemented robust security features, such as the covenant committee, a multi-signature verification scheme that ensures the safety and correctness of unbonding transactions.

The Babylon Bitcoin Staking Mainnet launch represents a significant evolution in how Bitcoin can be used within the broader blockchain ecosystem. By participating in this launch, you can contribute to the security of PoS systems, earn rewards, and engage with one of the most innovative protocols in the cryptocurrency space. As the launch progresses, staying informed and involved will be key to maximizing your experience with Babylon.

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Final word

And that's everything you need to know to be prepared for the mainnet launch. Stay tuned and follow us on Twitter/X to stay ahead of the curve.

Ready to start? Stake your first BTC with Babylon and Chorus One today!

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

Consensus mechanisms are the linchpins of securing blockchain networks and enabling their functionalities. While Proof of Stake (PoS) has been a stalwart method, ensuring robust security and operational efficiency, it is not without its limitations. Berachain, an Ethereum Virtual Machine (EVM) compatible Layer 1 blockchain, introduces a unique alternative: Proof of Liquidity (PoL).

This article delves into the innovative mechanisms of Berachain, exploring its genesis, unique tri-token model, and the technical prowess that Chorus One brings to optimizing this approach, with ‘BeraBoost’.

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The Constraints of Proof-of-Stake

Berachain's Proof-of-Liquidity (PoL) consensus mechanism addresses several limitations inherent in Proof-of-Stake (PoS) systems. In PoS, validators and users lock up a substantial amount of native tokens to secure the network. This staked capital, while ensuring network security, remains idle and does not contribute to the liquidity of the ecosystem. Consequently, these tokens cannot be used for DeFi applications, trading, or other on-chain activities. Although PoS is a resilient method for achieving consensus and securing blockchain networks, aiming for a high percentage of staked tokens can counteract liquidity needs within the ecosystem.

Liquid staking was developed to mitigate these concerns by creating liquidity for staked tokens, and it has proven successful in many ecosystems. However, Berachain's PoL model aims to surpass liquid staking. PoL can be simplistically described as "security by liquidity," meaning the only way to secure the chain is by providing liquidity. Given Berachain's primary focus on DeFi, this model is particularly relevant. But how does PoL actually function on Berachain?

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The Genesis of Berachain 🐻

Berachain's innovative journey began with the "Bong Bears" NFT project—a whimsical collection that captivated the DeFi community. Through this creative endeavor, the founders recognized a crucial gap: the need to harmonize liquidity provision with network security. This insight led to the birth of Berachain, designed to leverage liquidity as the cornerstone of its security model. With substantial backing from prominent investors such as Framework Ventures, Brevan Howard, Polychain Capital, and Samsung Next, Berachain is well-positioned to redefine blockchain consensus.

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Berachain’s Tri-Token model 🐻

At the heart of Berachain's ecosystem lies its tri-token model, consisting of BERA, BGT, and HONEY. Each token serves distinct purposes, ensuring that the network can achieve its objectives of security, governance, and efficient transaction processing while maintaining a stable economic environment for decentralized finance (DeFi) activities:

$BERA (Liquid Token)

• Function: Used for transaction fees and general utility within the network.
• Liquidity: Fully liquid and subject to market price fluctuations.
• Role: Facilitates economic activities and interactions on the blockchain.

$BGT (Governance and Staking Token)

• Function: Primarily used for governance and staking.
• Liquidity: Non-transferable and earned by providing liquidity.
• Role: Influences network governance and secures the blockchain through staking.

$HONEY (Stablecoin)

• Function: Provides stable value transfer within the ecosystem.
• Liquidity: Fully liquid and pegged to USD.
• Role: Acts as a medium of exchange, collateral, and fee payment mechanism.

Let’s take a deeper look at their individual roles:

How does Berachain work? 🐻

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1. Users stake their Proof of liquidity (PoL) eligible digital assets into reward vaults to receive $BGT rewards. Reward vaults are the sole method for earning $BGT rewards and thus play a crucial role in getting entry into the PoL ecosystem.
2. Validators produce blocks and allocate a portion of their $BGT emissions to specific reward vaults according to discretionary strategies. These strategies aim to maximize yield for their stakers. Validators take a commission on the $BGT emissions.
3. Applications can offer incentives to validators to encourage them to direct BGT rewards to them, usually in exchange for rewards in the form of the protocol’s native token.
4. Liquidity providers participating in PoL receive yields in $BGT, minus the validators’ commission.
5. Liquidity providers can stake $BGT with validators that align with their strategy and participate in governance.
6. Liquidity providers who receive $BGT can choose to burn $BGT to obtain $BERA tokens at a 1:1 ratio.

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Optimizing PoL performance through BeraBoost 🐻

Under the hood, PoL requires validators to direct incentives to on-chain pools of capital called "reward vaults”. We are committed to approaching this process scientifically, through an algorithm we’ve named “BeraBoost” - it will be open source software, and run on a public dashboard. Beraboost will distribute incentives such that delegators to Chorus One earn maximum rewards, by tracking their LP positions and directing incentives to the relevant pools.

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Staking BGT 🐻

Berachain is currently on testnet and staking is not enabled. We are closely involved with the Berachain team and will support all institutional and individual use-cases for supporting BGT. If you're interested in knowing more, fill out this form.

OR

Email us - staking@chorus.one

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

Bitcoin is the oldest and the most valuable cryptocurrency, boasting a market cap of over $1.2 trillion as of July 2024. Not only does Bitcoin have the highest mind share among cryptocurrencies, but it has also made significant strides in mainstream adoption, including its integration into ETFs and its recognition as a legal tender in El Salvador. Recently, it has been in the spotlight with former U.S. President Donald Trump pledging to hold Bitcoin as a strategic reserve if re-elected. While Bitcoin is renowned for its store-of-value proposition, many Bitcoin maximalists are content with simply holding it for the long term. However, a pertinent question arises—what more can be done with Bitcoin? Enter Babylon, a project aimed at harnessing Bitcoin's potential beyond being a mere store of value.

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The Genesis of Babylon

Approximately 2.5 years ago, David Tse and Fisher launched Babylon with a vision to leverage Bitcoin's proof-of-work (PoW) security to bolster the security of proof-of-stake (PoS) blockchains. Observing the trend of new chains opting for PoS due to its cost-effectiveness, efficiency, and lower energy consumption, they identified a gap: a trillion-dollar asset (BTC) remained largely idle. Bitcoin lacks native smart contract capabilities, limiting its utility in decentralized applications. Bridging BTC to other protocols or using wrapped versions like wBTC introduces trust issues with counterparties. Babylon aims to use BTC to secure PoS chains without bridging while providing full slashable security guarantees in a trust-minimized fashion.

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The Need for Bitcoin Staking

PoS chains secure their networks through staked assets, often incentivizing validators with high inflationary rewards. This bootstrapping process is complex and lengthy, leading to the emergence of 'security-as-a-service' protocols like EigenLayer, Symbiotic, and ICS (Interchain Security). Babylon seeks to apply a similar model using Bitcoin, the most decentralized and secure crypto asset. While some argue that Bitcoin should remain a store of value, others believe in enhancing its utility. Babylon offers a solution by unlocking Bitcoin’s capital prowess, currently under-utilized, and integrating it into the PoS ecosystem to generate yields and drive new use cases.

With over $1.2 trillion in market cap, most BTC lies idle and does not generate any yield for its holders. This contrasts with PoS tokens, where capital efficiency is maximized to provide higher yields and support the ecosystem. Bringing additional utility to Bitcoin through secure and trustless mechanisms like Babylon can significantly enhance its economic impact and foster new applications within the crypto industry.

Moreover, the tension between high inflationary rewards and ecosystem incentives can be alleviated by leveraging Bitcoin’s economic security. Projects can tap into Bitcoin's decentralization and security, reducing the need for high inflationary incentives to bootstrap validator sets. Ultimately, market dynamics will determine the true need for sourcing a protocol's economic security from Bitcoin, but the potential is immense if executed in a trustless and slashable manner.

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How Babylon Works

Babylon allows Bitcoin holders to stake their BTC for PoS blockchains without relying on third-party custody, bridges, or wrapping. It provides slashable economic security guarantees to PoS chains while ensuring efficient stake unbonding to enhance liquidity for Bitcoin holders. The protocol operates as a modular plug-in compatible with various PoS consensus protocols, serving as a foundational component for building restaking protocols. The core component, the 'control plane' (Babylon Chain), manages several critical functions:

• Timestamping Service: Ensures synchronization with the Bitcoin network.
• Stake Matching: Matches Bitcoin stakes with PoS chains and tracks staking/validation information.
• Finality Signature Recording: Records the finality signatures of PoS chains.

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Babylon vs Babylon Chain

Babylon is a Bitcoin Staking Protocol that provides shared security for PoS systems and allows Bitcoin holders to delegate their BTC to Finality Providers, who can then provide Bitcoin security to a consumer PoS chain or DA layer.

Babylon chain, on the other hand, is built on Cosmos SDK, which receives security from the Babylon Bitcoin Staking Protocol and acts as the first chain that Finality Providers can support. However, Babylon plans to support different PoS systems from various blockchain ecosystems and provide them access to shared security collateral with BTC.

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Detailed Mechanisms of Babylon

Timestamping

Timestamping involves embedding data at a specific point in time. Babylon records PoS chain data onto Bitcoin to leverage Bitcoin’s robust PoW security. Due to Bitcoin’s expensive and limited blockspace, direct timestamping of every PoS chain onto Bitcoin is impractical. Instead, the 'control plane,' implemented as a Cosmos-SDK chain (aka Babylon Chain), aggregates timestamps from all PoS chains via IBC. This ensures a secure and immutable record of PoS data on the Bitcoin blockchain.

Staking Process

To stake, a Bitcoin staker (e.g., Alice) sends a special transaction to the Bitcoin blockchain, locking her BTC in a self-custodial vault. This vault, defined by Bitcoin's scripting language, has three transaction types:

• Unbonding Transaction: Allows Alice to retrieve her Bitcoin after a predefined period once she initiates the unbonding process.
• Slashing Transaction: Sends the Bitcoin to a burn address if Alice violates the PoS protocol.
• Withdraw Transaction: Allows withdrawal after the staking period is complete, provided no violations have occurred.

Alice delegates her staking duties to a finality provider on the Babylon chain, who uses their private keys to validate the PoS chain on her behalf. This delegation maintains Alice's control over her Bitcoin while enabling participation in PoS validation.

Security Guarantees

Babylon ensures validators are accountable for their actions through cryptographic mechanisms like Extractable One-Time Signatures (EOTS). EOTS allows the network to detect and prove double-signing, exposing the validator's private key. This key, which is already pre-signed by the staker and the finality provider, is used to create a slashing transaction, burning the staked Bitcoin as a penalty. Babylon's protocol guarantees that a block is truly final only when it has received EOTS from at least 2/3 of the staked BTC.

A simplified transaction flow on Babylon would roughly look like this:

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‍BBN token

Though no official details have been released yet, we expect there to be a BBN token that the BTC delegators can then stake with a validator of their choice just like any other Cosmos chain.

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Comparative Landscape of Shared Security Solutions

While Babylon introduces a novel approach to shared security using Bitcoin's hash power, other protocols like EigenLayer, Symbiotic, and ICS offer alternative models:

• EigenLayer/Symbiotic: Uses Ethereum's PoS security and enables restaking within the Ethereum ecosystem.
• Interchain Security (ICS): Relies on the Cosmos Hub's PoS validator set or other Cosmos validator sets to secure connected zones.

Protocols must weigh several factors—security robustness, trustlessness, economic incentives, integration complexity, ecosystem compatibility, and regulatory considerations—when choosing a shared security solution.

We've covered this topic in more detail in our previous article here.

Role of Chorus One

Chorus One has been an early supporter of Babylon and we're already on its testnet as a finality provider.

Our FP address is 3e7af699845fae4817923f8c3484bc4759dc306d17255d859dcd0e08d9cc426c.

When Babylon goes live on mainnet, you will be able to stake BTC to Chorus One as a finality provider and earn the highest possible staking yields. If you want to learn more and be one of our early customers, click here. Also, don't forget to watch our podcast episode with David Tse, co-founder of Babylon!

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

About the Lava Network

The Lava Network (LAVA) is a marketplace of infrastructure providers who collectively enable users and developers to interact with blockchains, through infrastructure like RPC and APIs. This allows users to access blockchain data (like prices, transactions, and more) by leveraging a network of decentralized providers, ensuring transparency, reliability, and data accuracy without relying on centralized sources.

• Think of it like Uber for infrastructure providers (also called node providers).

By incentivizing data providers to serve accurate information and penalizing those who provide incorrect data, LAVA aims to solve the problem of unreliable and centralized data in blockchain applications. To learn more about Lava Network and how it works, check out our most recent blogpost here or our comprehensive deep dive found here.

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How to Stake

1. Install the Keplr Wallet Extension

For the focus of this guide, we recommend using the Keplr wallet. While Leap is usable, this guide will be walking through a demonstration with Keplr.

However, if you would like to use Leap wallet and stake directly to the Chorus One validator via w3coins, you can reference the quick guide below:

In case you don't have the Keplr extension installed in your browser, please visit https://www.keplr.app/ and click on 'Install Keplr'.

Click on Install Keplr for Chrome if you are using a Chrome browser or Brave if you are using the Brave browser and follow the installation instructions.

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2. Create/Import an Account

Click on the extension in the Chrome/Brave toolbar and the following page will open up.

• It is recommended to pin it to your browser toolbar by clicking on the jigsaw piece 🧩 icon and then the pin 📌 icon.

Select to either create a new wallet, import an existing wallet, or connect with a hardware wallet.

In case you do not have an existing Keplr account you can click 'Create a new wallet'.

If you already have a wallet to use, you can select 'Import an existing wallet' or you can connect with a compatible hardware wallet, such as a Ledger device.

• Alternatively, Keplr now offers the ability to associate your wallet with your Google account, however, this is a less secure way of establishing your wallet and is not recommended.

Here you can choose between creating, importing, or associating your wallet with your Google account.

If you choose to create a new wallet you will be shown 12 words as your mnemonic seed.

• Optional: You can select the 24 words option for a more secure mnemonic.

Please be sure to back up your mnemonic seed securely.

• It is recommended to store it physically; never in a digital format or as a screenshot.

Never share this seed phrase with anyone, as they will have access to your funds.

• A lost mnemonic seed phrase cannot be recovered.
• Anyone with your mnemonic seed phrase can take control of your assets.

Next, enter an account name and a passphrase to lock and unlock your wallet. You will be asked for the mnemonic again.

• Enter the 12 or 24 words in order and case sensitive (all lower case).
• This is to make sure you remember the mnemonic and confirm that you wrote it down correctly.

After verifying your 12 or 24 word phrase, you will be prompted to select any other Cosmos Hub networks you'd like to add to your wallet.

• In this case, we will be adding Lava (LAVA), so please be sure to select that from the list or use the search bar to find it.

No need to add any other networks if you don't plan on using them yet. You can always select more networks later.  

However, it is advisable to have 'Cosmos Hub' selected when creating your new wallet.

Be sure to search for LAVA in the list in addition to Cosmos Hub.

Once you selected the relevant networks you want to use, click 'Save' and you'll be all set to go.

All set!! Your Keplr wallet is good to go!

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3. Log in to your Keplr wallet

Regardless of whether you already have an wallet or if you just created it, you can now click on the Keplr extension to view your address or visit https://wallet.keplr.app/?tab=overview to see your full Keplr dashboard.

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4. Stake your LAVA

If you don't already have LAVA in your wallet, you can fund it with some tokens. You may use an exchange to transfer the tokens to your address or get it from a trusted third party that already holds some.

If you want to stake from the browser extension wallet, you can either navigate to the Keplr dashboard (shown below) or scroll down on the wallet screen and select LAVA.

Alternatively, you can connect Keplr to the w3coins explorer and stake to the Chorus One validator at this address: lava@1uxmygu9mc6kzykhquzdvtqlnxcprpgjxxhf6ln

Next, you will be prompted to stake.

How to access the dashboard from the wallet browser extension

Scroll down to find LAVA or use the search bar.

Once you are on the Keplr dashboard, to stake click on the 'Stake' tab in the left hand side of the dashboard.

Once there, you will see three steps highlighted in the pink box in the screenshot below.

1. Select Chain
2. Select Validator
3. Stake

Scroll or through the list or search for the chain you want, in this case LAVA.

• Then, repeat the same steps to find the Chorus One validator.

Once you've chosen the Chorus One validator, select how much LAVA you wish to stake, then click the 'Stake' button at the bottom of the screen.

Clicking on Stake will take you to Keplr wallet for approval. Approve the transaction and you will be able to see your stake.

• Note: If you are using a Ledger hardware wallet, you will need to have the wallet connected, unlocked, and approve the transaction there.

Please note that there is a 21 day unbonding process (also known as unstaking) for LAVA.

During this period your stake no longer earns rewards and cannot be transferred, exchanged, or spent.

However, you can cancel the unstaking process if you wish without penalty.

5. Claiming Rewards

After some time you will see rewards accumulating in your wallet.

• This can be easiest to view from the Keplr dashboard.

You can simply go to the Keplr dashboard to claim them by selecting 'Claim' and approving the transaction.

• You will see all rewards available from all networks you are staking with.
• You can choose to claim all pending rewards or select which networks you specifically want to claim rewards for.

6. Unstaking your LAVA

If you wish to unstake your LAVA, you can do so from the same interface in Keplr that you used to stake.

• Either go to the Keplr dashboard or manage your asset directly from the browser extension window.

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Simply click on the validator you wish to unstake from and you will be prompted with the following screen.

Please note that LAVA undergoes a 21 day unbonding period when unstaking.

To proceed, click on 'Unstake' and follow the prompts to select the amount of LAVA you wish to unstake. Then confirm and sign the transaction in your wallet.

And that's it! Your LAVA will begin unbonding which you can track from your Keplr dashboard under the Staking tab.

You can view and manage all ongoing unstaking transactions (undelegations) from your Keplr dashboard and cancel them if you change your mind.

After the unbonding period is complete you will be able to transact with your unstaked LAVA again!

A Note to Institutional Investors:

If you are an institution looking to stake LAVA with Chorus One, please reach out to us via our staking request form.

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

The floor is Lava, and the ceiling is infinite! 🌋

We're thrilled to announce that Lava Network is officially live on public mainnet. As an early investor and dedicated supporter, Chorus One has been closely working with the Lava team from testnet stages to this monumental mainnet launch. Our commitment to Lava is steadfast, and we are excited to continue supporting its development and future growth.

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What is Lava Network?

Lava Network is at the cutting edge of blockchain accessibility, providing a user-friendly and scalable solution to tackle the crucial requirement for an access layer in the blockchain infrastructure. Unlike conventional methods relying on centralized or public RPC endpoints, Lava Network leverages a decentralized array of premier service providers. This approach ensures trustworthy, secure, and swift RPC services.

Lava comprises a Cosmos appchain and an off-chain protocol. RPC providers register on the Lava chain to serve RPC across many different ecosystems. Lava can support any chain and by aggregating providers and routing requests, boasts lightning-fast speed, hyper-scalability, and nearly 100% uptime.

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How Lava works - A quick overview

1. Chains and rollups create an incentive pool on Lava, consisting of their native token or stablecoins or even memecoins
2. Providers join Lava to serve RPC requests to earn monthly rewards from the incentive pool, based on their quality of service and amount of LAVA staked
3. Lava aggregates providers and optimally routes requests based on geolocation and provider quality of service
4. Users and developers get free RPC; blockchains get happy ecosystems and reliable, cost-efficient infrastructure

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How Lava staking and restaking works

1. Users can stake LAVA to a Lava validator
2. RPC providers stake LAVA to join the network and serve requests for other chains
3. Users and apps send requests to many different RPC providers
4. RPC providers on Lava are selected to handle more requests if they have higher performance and higher amounts of staked LAVA.
5. Users can restake their Validator stake to an RPC provider on Lava
6. Restaking to an RPC provider on Lava helps improve performance and security across the network, meaning the fastest and most reliable providers serve requests more often
7. As of today, only Lava RPC will be supported on Lava Mainnet. So users can only restake to Lava RPC providers via a UI provided by Leap wallet.More chains will be added soon.

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Architecture of Lava Network

Lava Network is structured with several key architectural elements:

Specifications (Specs)

Lava can support any chain but to add these chains, specifications must be written and pass through governance. Specifications are simple JSON files which describe the RPC calls and the compute cost to serve each call. Once a spec is added to Lava, RPC providers can join and serve the RPC calls for the new chain.

Peer-to-Peer Lava SDK

The Lava SDK is a decentralized, peer-to-peer blockchain RPC for developers exploring cross-chain functionality. This JavaScript/TypeScript library provides decentralized access to all chains supported by the Lava ecosystem. It simplifies the process of building decentralized applications and interacting with multiple blockchains, offering tools for both server and online environments.

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The LAVA Token

The LAVA token is central to the Lava Network, serving multiple functions within the ecosystem:

• Reward Infrastructure Providers: LAVA is used to reward providers on Lava.
• Native Token Earnings: Providers can earn native tokens from chains/rollups supported by the network.
• Restaking: LAVA can be restaked to lower security fees to the protocol, boost the performance of the network and earn additional rewards.
• Capped Supply: LAVA has a capped supply with deflationary mechanisms.

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Tokenomics

The team has published detailed tokenomics, emphasizing the role of LAVA in rewarding infrastructure providers and supporting network security. Please refer to the official tokenomics documentation.

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Why Stake Lava?

Staking Lava not only secures the network but also provides opportunities to boost network performance by giving more weight to top RPC providers. By staking with Chorus One, you can participate in securing the Lava Network while earning rewards from multiple blockchains. Here are the key benefits:

• High Rewards: Earn from staking LAVA and additional tokens from supported chains.
• Enhanced Security: Restaking helps improve the performance and security of the network.
• Community Growth: Support the growth of a decentralized, robust blockchain infrastructure.

How to Get Started

Staking Lava with Chorus One is easy. Follow these three simple steps:

1. Visit the Lava Network on Staking Rewards.
2. Search for the Chorus One validator.
3. Stake & Restake your LAVA and start earning rewards!

More Resources

• Podcast: Watch our podcast with Lava CEO, Yair Cleper.
• How to stake LAVA with Chorus One: https://chorus.one/articles/how-to-stake-lava-with-chorus-one
• Video guide for staking LAVA: https://youtu.be/LTshHMV9Gq0

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Staking LAVA with Chorus One

To learn more or to if you’re an institution looking to stake LAVA with Chorus One, please reach out to us at: https://shorturl.at/znows

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 60+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.

In Part 2 of our TON Series, we dive into TON’s staking mechanisms. We'll cover the what, why, and how of staking TON, as well as how to get started easily with Chorus One.

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An introduction to TON Staking

TON leverages the Proof of Stake (PoS) consensus algorithm, a system where validators are responsible for proposing and validating new blocks of transactions. In TON's PoS model, validators are selected through a competitive election process to ensure the highest levels of security and performance.

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The Election and Validation Process

The election process is central to TON staking. During each consensus round, potential validators submit their applications along with their stake and other parameters, which determines the level of maintenance they are willing to perform. The Elector governance contract evaluates these applications, selecting validators based on their stake and parameters, aiming to maximize the network's overall stake.

Once selected, validators enter a validation cycle, as depicted in the timeline diagram below:

Key Phases of the Validation Cycle:

1. Election (6-7 hours): Candidates apply to become validators.
2. Delay (2-3 hours): A brief waiting period before validation starts.
3. Validation (18 hours): Validators approve transactions and propose new blocks.
4. Hold (9 hours): Validators prepare for the next cycle.

To ensure continuous network operation, TON employs two types of pools—odd and even—which operate in alternating cycles, providing seamless validation without interruptions.

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Minimum stake

To be eligible for the validator election process, validators need a minimum stake of

300,000 TON. Validators stake Toncoin for a fixed specific term, and the stake is refunded with interest after the completion of a validation round.

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Validator rewards

Each transaction on TON requires a computation fee called gas used to conduct network storage and the transaction processing on-chain. Like most blockchain networks, on TON, these fees are accumulated within the Elector contract in a reward pool. 50% of fees users pay are burnt and 50% goes to validators.

The network also subsidizes block creation by adding a subsidy to the reward pool equal to 1.7 TON for each block in the main chain, called masterchain. TON’s architecture allows for the creation of parallel chains, called  workchains. For workchain blocks,  the reward per block is set to 1 TON. The network has an inflation rate of approximately 0.3-0.6% annually.

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How does TON staking work?

TON offers several staking mechanisms to cater to different needs and preferences. Let's explore these options:

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1. Nominator Pool ‍

The Nominator Pool is central in TON's staking ecosystem, offering a collaborative approach to staking that allows multiple users to pool their Toncoin (TON) tokens and collectively participate in the network's validation process. This pooling mechanism is designed to democratize staking, making it accessible to a broader range of participants who may not have sufficient tokens to meet the minimum staking requirements individually.

The Nominator Pool enables a group of up to 40 nominators (stakers) to combine their staking power and delegate it to a validator like Chorus One. This collective staking approach not only helps in meeting the high minimum staking thresholds but also ensures that the network remains secure and robust by leveraging the combined resources of multiple stakeholders.

How the Nominator Pool Works:

1. A nominator joins the pool by staking a minimum of 10,000 TON tokens.
2. The pool collectively stakes the combined tokens through a validator. The operator managing the validator must stake at least 1,000 TON tokens which are used to protect against bad behavior.
3. The Election Process starts: During the election phase, which lasts between 6 to 7 hours, the pool’s validator submits an application for validation, along with the combined stake from all nominators.
4. Delay Period: After the election, there is a delay of 2 to 3 hours before the validation phase begins.
5. Validation Cycle: The validator then participates in an 18-hour validation cycle, during which they propose and validate new blocks of transactions.
6. Reward Distribution: At the end of each validation cycle, the rewards earned are distributed among the nominators based on the proportion of their stake in the pool.
7. To access their rewards, nominators need to send a transaction of 1 TON to the pool with a specific comment, which triggers the return of their entire stake and earned rewards.
8. Withdrawal: Nominators can withdraw their entire stake and rewards in one transaction. Partial withdrawals are not supported via this mechanism, necessitating a complete withdrawal of funds when accessing rewards.

To visualize the Nominator Pool workflow, consider the following diagram:

This workflow ensures continuous network validation, with odd and even pools alternating their validation cycles to maintain seamless operation and security of the TON blockchain.

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Pros and Cons of the Nominator Pool

Pros:

• Relatively low effort to set up, with support from validators like Chorus One
• Allows multiple nominators to pool resources, making it easier to meet staking thresholds.
• Automatically handles proportional reward distribution.

Cons:

• The minimum staking requirements might exclude investors with less than 10,000 TON.
• Only allows full withdrawals, which can be restrictive for nominators needing partial access to their funds.
• Utilizes a hot wallet for operational fees, posing potential security risks.

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2. Single Nominator Pools

The Single Nominator Pool is a streamlined and secure staking mechanism within the TON ecosystem, designed specifically for validators who have sufficient TON to stake independently (aka solo stakers). This approach reduces complexity and enhances security by focusing on a single nominator, making it an ideal choice for those who prefer a more straightforward staking process.

The Single Nominator Pool allows a single entity to manage the staking process, providing a simplified and secure framework for validators. By eliminating the need for multiple nominators, this mechanism significantly reduces the attack surface, making it easier to safeguard the staked assets.

How the Single Nominator Pool Works

1. A Single Nominator Pool is deployed by a validator like Chorus One.
2. Only one nominator, who is also the pool owner, stakes their TON tokens. The single nominator can stake any amount of TON which should meet the protocol minimum requirement (currently 300,000 TON tokens).
3. The nominator applies for validation by submitting their stake during the election period (6-7 hours).
4. After the election, a delay of 2-3 hours occurs before the validation phase begins.
5. The validator participates in an 18-hour validation cycle, validating transactions and proposing new blocks.
6. All rewards generated during the validation cycle are directed to the single nominator.

• Flexible Withdrawals: The nominator can withdraw any amount of their stake and rewards, offering greater flexibility compared to multi-nominator pools.

7. The pool uses a cold wallet to store the principal staking funds, significantly reducing the risk of theft.
8. Hot Wallet Operations: The validator uses a hot wallet to manage operational fees, ensuring that the cold wallet remains secure.

To illustrate the workflow of the Single Nominator Pool, consider the following diagram:

This simplified workflow highlights the continuous cycle of election, delay, validation, and hold phases, ensuring the seamless operation and security of the TON blockchain.

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Pros and Cons of the Single Nominator Pool

Pros:

• Easy to deploy and manage a single nominator pool.
• Reduced attack surface via the use of a cold wallet for principal funds.
• Allows partial withdrawals, providing greater flexibility for the nominator.

Cons:

• Not suitable for groups or multiple nominators with smaller holdings of TON tokens.
• Doesn’t support distribution of rewards between validator and nominator, requiring technical expertise from nominator to operate the pool, or off-chain payments.
• All operations rely on the single nominator, which can be a limitation for shared or community-based staking.

The Single Nominator Pool offers a secure and efficient staking solution for individual validators, combining simplicity with enhanced security measures. By focusing on a single participant, this mechanism ensures that the staking process is straightforward and easy to manage, making it an attractive option for those looking to stake their TON independently.

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3. Liquid staking

Liquid Staking protocols enable TON holders to participate in staking pools, lending their funds to validators at a predetermined interest rate. In return, stakers receive liquid staking receipt tokens, known as Pool Jettons, which represent their share in the pool. These tokens can be exchanged back for TON at any time, allowing stakers to maintain liquidity while earning rewards.

The protocol is user-agnostic, accommodating users of all capital sizes without any minimum or maximum stake requirements.

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How TON Liquid Staking Works

1. Users stake their TON in a pool managed by the Liquid Staking Contract.
2. Upon staking, users receive Pool Jettons, which are liquid staking receipt tokens representing their share of the pool. These tokens ensure that users can maintain liquidity and withdraw their staked assets whenever needed.

3. Staked funds are lent to validators, who use them for participating in the network’s validation process. Validators are chosen based on their stake and maintenance parameters during election phase, followed by a validation cycle.
4. During each 36-hour validation cycle, validators earn rewards, which are distributed proportionally to all participants in the pool.
5. Rewards come from interest payments made by validators who borrow the staked funds. The value of Pool Jettons increases as rewards are distributed, reflecting the growing stake in the pool.
6. Users can deposit and withdraw their assets at any time without any predefined limits, managed through specialized smart contracts that ensure accurate accounting and security.

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Pros and Cons of TON Liquid Staking

Pros:

• User-agnostic design makes it suitable for all users, regardless of their stake size or technical expertise.
• Allows partial and full withdrawals at any time, providing liquidity to stakers.

Cons:

• Higher effort required for deployment and management due to the use of multiple smart contracts and DAOs.
• Reliance on various smart contracts can increase the risk of vulnerabilities, necessitating rigorous audits and security measures.

The Liquid Staking Contract offers a versatile and powerful staking solution on the TON blockchain, combining the benefits of liquidity, decentralization, and accessibility. By understanding and leveraging this mechanism, users can participate in network validation more flexibly and securely, contributing to the overall stability and growth of the TON ecosystem.

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Staking TON with Chorus One

Chorus One offers white-label TON validator services for institutional customers, as well as deployment and management of nominator pools. We can create nominator pools for our customers, requiring a minimum delegation of 300,000 TON tokens (TONcoin).

As the operator, Chorus One takes full responsibility for the operational fees, maintenance, and performance of the validator, ensuring seamless and efficient service.

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Ready to get started, or want to learn more?

Fill this form - https://chorusone.my.salesforce-sites.com/WebToLead

OR

Email us - staking@chorus.one

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About Chorus One

Chorus One is one of the biggest institutional staking providers globally, operating infrastructure for 50+ Proof-of-Stake networks, including Ethereum, Cosmos, Solana, Avalanche, and Near, amongst others. Since 2018, we have been at the forefront of the PoS industry and now offer easy enterprise-grade staking solutions, industry-leading research, and also invest in some of the most cutting-edge protocols through Chorus Ventures. We are a team of over 50 passionate individuals spread throughout the globe who believe in the transformative power of blockchain technology.